Bybit Exchange Ordered to Stop Operating in Malaysia

The Malaysian government is tightening the grip on cryptocurrency exchanges in its territory. Previously, Huobi Global also withdrew from the market.

On December 27, the Securities Commission of Malaysia (SC) ordered Bybit to stop operating in the country, after discovering that the exchange was not registered (DAX) with the country's regulatory body.

According to the announcement, the SC ordered Bybit to disable all online platforms from its website to its mobile application within 14 working days from December 11.

Bybit was also ordered to stop advertising and close its Telegram support group for Malaysian users. By December 27, the SC confirmed that Bybit had fully complied with these requirements.

SC Malaysia also issued serious warnings to investors. The agency stressed that operating an unlicensed exchange is a violation of the Capital Markets and Services Act 2007. The SC recommends that investors only use licensed DAX platforms, as these exchanges must comply with strict regulations to protect investors' rights, otherwise they will not be protected by Malaysian law, leading to the risk of facing money laundering and fraud.

The SC's crackdown comes in the context of Bybit's recent announcement to leave the French market, after the country made it difficult for crypto companies to pave the way for the European Union's MiCA bill.

In addition, on December 23, the SC continued to list crypto wallet Atomic Wallet on the list of financial companies banned from operating in Malaysia. Sharing the same fate as Bybit, Atomic Wallet was accused of operating an unlicensed DAX. In the past, the Securities Commission of Malaysia has "blown the whistle" on Huobi Global and even Binance.

The Malaysian government has not only been closely monitoring exchanges, but has also stepped up its efforts to combat cryptocurrency-related criminal activities. On June 17, the Malaysian Internal Revenue Department launched an operation called “Ops Token,” which targeted companies that failed to report their cryptocurrency trading activities to the tax authorities. Authorities have seized evidence of tax evasion stored on mobile devices and computers. Malaysia has also destroyed 985 Bitcoin mining machines to deter local “electricity theft.”